EU Grains Mostly Lower On The Day And For The Week

28/03/14 -- EU grains closed mostly lower, with the exception of rapeseed which ended the day with gains of EUR1.25-3.75/tonne.

May 14 London wheat closed GBP1.00/tonne easier at GBP167.25/tonne, and with new crop Nov 14 GBP1.20/tonne lower at GBP158.10/tonne. May 14 Paris wheat closed EUR1.75/tonne lower at EUR209.75/tonne, Jun 14 Paris corn was down EUR0.50/tonne to EUR185.25/tonne and May 14 Paris rapeseed rose EUR1.25/tonne to EUR412.25/tonne.

For the week, May 14 London wheat was down a pound and new crop Nov 14 fell GBP1.90/tonne. May 14 Paris wheat fell one euro, whist corn was down half a euro whilst rapeseed jumped eleven euros. The pound rallied more than a cent and a half against the dollar, and by a euro cent and a half against the single currency during the course of the week, putting London wheat under a bit of pressure, particularly on new crop.

The unprecedented pace of EU wheat exports remains supportive, at least in the old crop positions, although corn continues to pour into Europe, displacing wheat.

The trade now has an eye on new crop prospects. Coceral forecast the EU-28 soft wheat crop at 135.9 MMT in their first look into 2014/15, down slightly on the 136.3 MMT produced last year, but 1.2 MMT higher than the EU Commission's estimate earlier this month.

Coceral estimated the EU-28 barley crop at 55.3 MMT, a 6.9% fall on last year. They said that Europe's corn crop would rise marginally on last year to 63.7 MMT, and that rapeseed output here would increase by 300,000 MT to 21.1 MMT.

Unseasonably mild weather conditions across almost the whole of Europe have crop maturity well advanced versus 12 months ago. FranceAgriMer today reported that 73% of the French winter wheat crop is displaying an ear of at least 1cm long, up sharply from 43% a week ago. Only 9% of the crop was at that stage this time last year.

French winter barley is also 73% at the same stage versus 38% a week ago and only 8% a year ago.

FranceAgriMer said that 96% of the spring barley crop is now in the ground, up from 87% last week and compared to 72% this time last year. Corn planting has yet to begin.

They said that 75% of the French winter wheat crop is rated as good/very good, the same proportion as last week and 9 points ahead of a year ago at this time. French winter barley rated good/very good was placed at 72%, up a point on a week ago and 5 points ahead of this time last year.

The HGCA said that UK winter wheat crops "have recovered well from the saturated soils over winter, with the majority of crops having good plant and tiller numbers. Many crops are more advanced than normal with over 30% of the area at stem extension compared to typically about 10% at the end of March." Winter barley is at a similar stage of maturity, they estimated.

For spring barley "soil conditions improved throughout the month allowing cultivation and drilling of spring barley to get underway. By the end of the month about 30% of the planned UK area was drilled, with most progress in the drier eastern side of the country, and very little drilled further north and in Scotland," they added.

Further east in Europe, things don't look quite so rosy. "March dryness has become very pronounced in Germany, Europe’s second biggest wheat country threatening the 2014 wheat harvest. Serious drought extends also into western Poland, Czech Republic, Romania and Bulgaria. All have received less than half of normal normal winter precipitation," said Martell Crop Projections.

This dryness extends all the way from Germany across to Ukraine where "like Europe, unseasonable warmth has prevailed in March. Temperatures yesterday in Ukraine reached 60s F and low 70s F, more typical of midsummer than spring. The heat is exacerbating moisture stress in central Ukraine," they added.